Power of Sale/Bank Sale Homes in Toronto, Peel (Mississauga, Brampton), York (Markham, Vaughan), & Durham (Pickering, Ajax, Whitby) Regions
Welcome to my Power of Sale page for July, 2014. At the request of my clients and contacts - I have posted a definition of Power of Sale properties below and provided some general non-specific information about a few properties that are under power of sale by various financial institutions and are listed for sale in the MLS system. These properties (see bottom of the page) may not stay actively listed for more than a few weeks or months after July, 2014 - but you can always request fresh new Power of Sale listings from me by using the form at the bottom of this page.
So, what are Power of Sale properties?
If a borrower or mortgagor is unable to make mortgage payments or is in default according to the mortgage contract, the 'Power of Sale' is the right of the lender or the mortgagee to force the sale of a property without judicial proceeding. For a lending financial institution (mortgagee) - this is the most frequently used method by which it can remedy a default by the homeowner (borrower/mortgagor).
However, the lender cannot just list the home for sale at the mortgage loan balance amount. It has to at first try to retrieve the current market value of the property through the sale. Of course - if the property is left unsold for a prolonged period of time, the lender can then gradually reduce the sale price to make it more attractive to potential buyers. Once the property is sold, and if the sales proceeds are more than the mortgage balance and the sales related costs, the lender is then obligated to return the rest of the funds to the defaulting homeowner (borrower/mortgagor) assuming there are no other liens or unpaid loans against the title of the property.
There are other complex issues that may rise up in a Power of Sale property purchase transaction, such as - the current homeowner (who is in default) can regain the control of the property by paying off all arrears or unpaid mortgage payments - even right before the sale transaction is completed on the day of closing). Thus, it is always best to seek expert advice from your lawyer regarding these kind of sales transactions. Also, the property may not remain in the best of condition, and should always be inspected by a home inspection professional before making final the purchasing decision.
Keeping all these in mind - Power of Sale properties - if they are on the market for a prolonged period of time and are in a reasonably good condition - can sometime be sold anywhere from $20,000 to $50,000+ less than their original market value. This is what makes these properties attractive to a lot of investors or even first-time buyers. As long as the buyers and their realtors do their due diligence in making sure - there are no serious damage to the homes (except for minor cosmetic issues which can be easily fixed) - these Power of Sale properties can and do offer substantial savings compared to other comparable properties in the market.
I have searched and found a few Power of Sale of properties during the month of March, 2014 - located all over the GTA (Toronto, Mississauga, Brampton, Oakville, Milton, Vaughan, Markham, Richmond Hill, Pickering, and Ajax). I have only posted some very general information on some of these Power of Sale properties - and you can ask for more detail information at the end of this page.
Toronto Power of Sale Homes:
1. A Downtown Toronto Waterfront Condo with 1 Bedroom+Den - below $275,000.
2. A 3 Bedroom + 2 Bathroom Condo Townhome on Victoria Park Ave, Toronto East - priced at below $300,000.
3. A 2-Storey Semi-Detached home in Toronto in the Weston-Pellam Park neighbourhood around $300,000.
Mississauga, Brampton, Milton, Oakville, Markham, Richmond Hill, Pickering and Ajax Power of Sale Homes:
1. A 4-Bedroom + 3 Bathroom 2-Storey Townhome in Milton for below $300,000.
2. A 3-bedroom, Detached 2-storey home in Brampton for below $350,000.
3. A 4-Bedroom, 4-Bathroom Detached 2-Storey Home in Oakville for under $575,000.